Jersey proposes FOFA-like adviser regulations

The government of Jersey, a British Crown dependency and tax haven off the coast of France, has released a consultation paper proposing regulations mirroring Australia’s FOFA legislation.

The Jersey Financial Services Commission issued proposed Codes of Practice for Investment Business on September 27, with the “aim of improving the quality of advice offered to retail investors”.

The proposed codes include provisions significantly altering the remuneration structure of financial advisers operating in the jurisdiction.

Among the proposed reforms are a new requirement for “employees of firms providing investment advice to retail clients” to have “qualifications and credit framework level 4 or above, or level 3 where the employee has undergone the appropriate gap-fill training and assessment”.

In addition, “advisers of Jersey resident retail clients will no longer be allowed to be remunerated for their services by commission payments from product providers”, mirroring the conflicted remuneration bans implemented by the UK and Australian governments in the Retail Distribution Review and FOFA regimes respectively.